Asciano to shed 500 jobs, targeting $90m savings

Freight and logistics company Asciano is planning to shed 500 staff as it looks to save $90 million a year.

In an investors briefing, the company told analysts that it would accelerate two new "business improvement programs", with the aim of reducing staff numbers by 500 by June 30 and saving $90 million next financial year.

Asciano says its original cost saving program has also been doubled to target savings of $300 million by financial year 2016.

The company has maintained its forecast for low single digit growth in underlying profit in the current financial year, but says its statutory result will be hit by around $120-130 million in one-off costs, up from a previous estimate of only $15-25 million.

Asciano says around $75 million of the costs are related to the rationalisation of its rail fleet following the integration of two rail divisions, with the other large contributor being the restructure of corporate and shared services.

Redundancies are set to cost the company between $25-30 million, with most of those layoffs expected to be completed by June 30.

The company is promising higher dividend payouts from financial year 2016 on, as its major capital expenditure program and restructures are completed.

Investors have welcomed the company's plans, pushing Asciano's shares up 3.25 per cent to $5.40 by 10:28am (AEST).